Back in Black: Yes Bank looks to accelerate turnaround via retail route

New Delhi (IANS)┬áLender Yes Bank, which has shown a dramatic improvement in financial performance — even after paying back the Central Bank’s emergency funding — plans to accelerate its turnaround via boosting retail customer base by offering tech-enabled services.

In a conversation with IANS, Yes Bank’s Managing Director and Chief Executive Prashant Kumar identified four focus areas to improve lender’s financial health.

The top priority, he said, encompasses increasing the bank’s retail base.

“Last month, we opened 60,000 accounts… till December-January we are aiming to reach 100,000 accounts per month,” he said.

“This not only increases our retail base, it also instils confidence in the bank.”

Prashant Kumar has been credited with the turnaround of the bank which was placed under moratorium earlier this year.

A consortium of lenders, led by the State Bank of India, then rescued the bank and appointed a new Board along with Kumar, who was earlier the SBI’s Deputy Managing Director and Chief Financial Officer.

Presently, the lender has fully paid back the RBI’s special liquidity facility of Rs 50,000 crore and posted a net profit of Rs 129 crore for the July-September quarter.

In the corresponding quarter of the last financial year (2019-20), the bank had reported a loss of Rs 600 crore.

The net interest income of the restructured bank increased 3.4 per cent on quarter on quarter basis to Rs 1,973 crore.

Furthermore, the bank has also successfully raised Rs 15,000 crore via further public offering (FPO).

On the lending side, Prashant Kumar said that focus will be to facilitate more retail, MSME and personal loans.

“Earlier, there was a massive focus on corporate lending. Now, we are focusing on growing our retail and MSME portfolio,” he said.

“Auto, home and MSME loans have picked up. We aim to facilitate this move by allocating Rs 10,000 crore towards financing this type of demand.”

The bank is aiming to change its lending mix and have corporate share at 40 per cent and increase the retail and MSME at 60 per cent over a period of time.

In regards to the bank’s introduction of tech-supplemented services, Prashant Kumar said: “This is our strength area. We provide the personalised services to all our clientele, especially in the age of social distancing. During the lockdown phase these services came in very handy.”

“These type of services have been hugely appreciated by our customers, especially the NRIs. We will continue to focus on introducing such services in the future as well. They provide a differentiated services experience than other larger players.”

Besides, he pointed out the tech-enabled services has also allowed the bank to augment savings, thereby, improving the overall financial position.

“We got to expand with limited manpower and resources. This can only be done through technology,” he said.

“We have already managed to get expenses under control. This has been done via rationalisation efforts which will be continued but without any job loss.”

Till now, the bank has managed to reduce expenses by 21 per cent in Q2FY21.

It aims to reduce 20 per cent in FY21.

Furthermore, Prashant Kumar foresees the green shoots of economic revival in the country which will also buoy the bank’s prospects.

“We might be able to reach the pre-Covid levels within the next 6-months contingent to the fact that there is no second wave and infection rate comes under control,” he added.

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